In its September 2003 report to Congress, “Alcohol Marketing and
Advertising,” the Federal Trade Commission asserted that it would “continue
to monitor alcohol industry self-regulation” and the “effectiveness of
third-party and other external review programs” concerning alcohol
advertising.

For that reason, I want to bring to your attention the attached recent
correspondence we’ve had with the Beer Institute and Anheuser-Busch. It
concerns a naked violation of the Beer Institute’s Voluntary Advertising
Guidelines and Anheuser-Busch’s unilateral refusal to take corrective
action, in supposed accordance with the complaint process now in effect at
the Beer Institute.

We believe that Anheuser-Busch’s dismissive response to CSPI’s ad complaint
superbly illustrates the oxymoronic character of beer-industry
self-regulation. Both the process – which ignores the FTC’s recommendation
that the industry adopt independent third-party review – and the guidelines
themselves are totally ineffectual and in need of repair, replacement, and
heightened government oversight.

CSPI
alerted the Beer Institute about a Bud Light television advertisement
that clearly violates both the spirit and letter of its voluntary
advertising code. Rather than respond to the complaint and seek a reasonable
explanation from Anheuser-Busch, or take any action to enforce its
advertising code, the Beer Institute, according to its process for handling
complaints, merely forwarded it to the offending advertiser, Anheuser-Busch.

That company, through its Vice President for Consumer Affairs, John
Kaestner, responded
directly to CSPI, by flatly rejecting the complaint. In so doing, Mr.
Kaestner ignored the clear language of the Beer Institute’s guidelines (ads “should not portray or imply illegal activity of any kind”)
and distorted its meaning by responding that the company “disagrees with
your assertions that these ads ‘promote’ illegal activity.”

What kind of self-regulation is this when the offending company both creates
and interprets new rules in response to complaints about its advertising?
Furthermore, Mr. Kaestner’s additional defense – that the ads are merely
“over the top” humor – likewise constitutes a self-serving, unsubstantiated
interpretation of the code. As far as we can tell, the Beer Institute’s
voluntary code provides no exception for humor. Indeed, the “principles”
underlying the guidelines state that “Beer advertising should not suggest
directly or indirectly that any (emphasis added) laws applicable to the sale
and consumption of beer should not be complied with.”

Millions of viewers have watched the subject Bud Light advertisements and
will continue to watch as long as A-B wants to air them. Many young people
recognize the illegal activity involved in the ads, and, in fact, view the
ads as spoofing illegal underage drinking and youths’ efforts to hide that
drinking from law enforcement officers. Who else runs from police when
caught with beer?

Unfortunately, neither beer industry “self-regulation” nor effective
government intervention is available to challenge this cynical advertising
campaign. Self-regulation serves the interests of producers, not consumers.
It has a history of vague standards, shoddy enforcement, and no penalties
for non-compliance. Unless the Commission exerts additional influence on
producers to adopt independent third party review and voluntary advertising
guidelines with teeth, such inappropriate ads will continue to air with
impunity, leaving consumers with only a false perception of recourse.

We respectfully request that the FTC take action to improve the beer
industry’s complaint process and strengthen its voluntary advertising
standards.